Prospective claimants are often nervous of the costs that they will incur and of their prospects of recovering them from the defendant. They are right to consider them, especially if the case is complicated with an uncertain outcome or if the defendant is likely to try and evade payment after judgment has been awarded. Costs can be put into three categories as follows:
This is correct at the time of publication but it might be wise to check that changes have not since been made. A court fee is payable when a claim is issued and it will be on a sliding scale according to the size of the claim. If a defence is entered and if the claim is for an amount greater than British Pounds 1,000, the claimant must pay a fee to file the allocation questionnaire. There are other court fees, in particular in the area of enforcement of judgment.
Court fees must be paid in advance and the required action will not happen if this is not done. All court fees may be added to the claim and are recoverable from the defendant if the case is won or undefended. All properly claimed court fees for enforcement are recoverable from the defendant. Payment of the court fees is enforceable in exactly the same way as the original debt. However, you must succeed in obtaining payment from the defendant. If you cannot do this, the court fees must ultimately be written off as irrecoverable.
These may be added to the claim if, and only if, it is prepared by a solicitor. So long as the claim is undefended or successful, they are recoverable from the defendant. Solicitor's costs may also be claimed in respect of certain other forms that may be necessary. As with court fees you must succeed in getting them from the defendant, and if this cannot be achieved, they are irrecoverable. Solicitor's costs are added to the claim according to a scale. The amount added to the claim may well not be the same as the amount actually charged by the solicitor.
If the case is not defended, you will be responsible for your own legal and other costs. These may be small or, if you have not employed a solicitor or other specialist, they may be non-existent. The starting presumption in a defended case is that the loser will pay the winner's costs. However, the judge has discretion and may take into account the behaviour of the parties. He may not award costs or only award a reduced amount. If the claim is for less than British Pounds 5,000 and is decided in the small claims track, legal costs will not be awarded but reasonable out of pocket expenses may be awarded.
A further factor is that costs awarded will be according to an approved scale, and may well be less than what has actually been paid. It is an extremely rough guide but you may perhaps get two thirds of the amount actually spent. Wide variations will be encountered and if you employ very expensive legal practitioners, the amount recovered will probably be less than two thirds of the sum spent. A final point is that you must succeed in getting the defendant to pay the amount awarded, and the usual enforcement remedies are available to you for this purpose. If you do not succeed, the costs awarded will be irrecoverable.
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1. Interest rates can be included in the contract and are very important
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